Independent Electricity Suppliers: The way to reduce electricity costs for commercial and industrial consumers.

by Michalis Filippou, Dipl. Engineer

Electricity Market Officer, Green Energy Group


The Electricity Market of Cyprus is currently operating under “Electricity Market Transitional Arrangement” model. It will continue to do so until the start of the commercial operation of the final “Competitive Electricity Market” that implements a market model within the framework of the so called “Target Model”. The “Target Model” is in accordance with the requirements set by ACER, the European Union’s Agency for Cooperation of Energy, which is followed by most countries in the EU.

CERA issued the “Regulatory Decision 04/2017”, by which the Electricity Market Transitional Arrangement entered into force on 1 September 2017. It has also issued the Electricity Market Transitional Arrangement Regulations as well as other several relevant Decisions to regulate the current transitional period.

According to the regulations, the Transmission System Operator of Cyprus is designated as the responsible body for implementing the Electricity Market Transitional Arrangement and will also be the Operator of the Competitive Electricity Market.

Under the Transitional Arrangement, private Suppliers create their supply ‘‘basket’’ by entering into bilateral Power Purchase Agreement contracts (PPAs) with Photovoltaic Park Renewable Energy Producers. The first private, independent electricity Supplier became active under the Electricity Market Transitional Arrangement in January 2021.

The process of switching from the EAC Supply to an Independent Electricity Supplier is a straightforward process, especially when larger commercial and industrial consumers are involved as those already have the appropriate required Seasonal Time of Day (STOD) type meters already installed in their facilities.

To switch over to a new supplier, the target suppliers will ask their prospective customers to provide them with the consumption data of the metered supply they are interested switching to the new supplier Company and the desired switch over date. If the data is not available, clients can authorise the Supplier to obtain these instead from the Distribution System Operator. Thereafter, once the commercial terms of supply have been agreed (e.g., rates etc.), the relevant form for transferring to the new Supplier is signed by the customer, and the procedure is completed at least 2 weeks before the requested date of the switchover.

Transferring to a new Supplier does not include any physical or electrical intervention, especially for customers with a STOD meter already installed (Tariff 30 or 40). For Tariff 20 and Tariff 10 meters, it is currently required to replace the meter by an STOD type before switching to a new supplier.

At the end of the billing period, the customer will begin to be billed by the new Independent Supplier at the agreed rates.

There is no discrimination as regards to the use and grid services between independent Suppliers and EAC customers. The transfer is logged via a simple entry in the DSO consumer databases. Therefore, the customer will not perceive any difference in the “quality” of the electricity supplied to their premises, nor any distinction in case of network failures, since the electricity distribution infrastructure (i.e., the electricity network) is shared between all electricity customers, regardless of their Suppliers.

The benefits for consumers contracted with Independent Energy Suppliers are obvious, the first being the increased flexibility of available tariffs from different providers which could lead to a reduction of the cost of electricity to clients. New Suppliers usually offer their customers incentives for attracting new customers, such as discounted electricity rates on the energy, per se. Independent Suppliers, as mentioned above, are usually sourcing their energy from Renewable Energy Producers, who can offer more stable pricing as they are decoupled from both, fossil fuel pricing as well as the pricing of the European Union Emissions Trading Scheme (EU-ETS), also known as CO2 emissions cost, which fluctuate with time.

The supplied energy is also generally environmentally friendlier and hence could help customers enhance the environmental profile of their companies by reducing their carbon footprint.

Furthermore, Independent Suppliers could offer better service to their customers, as they are usually smaller and more agile compared to the dominant Supplier of electricity in Cyprus (EAC). In many cases, Independent Suppliers can also offer additional services that are currently not offered by EAC, such as recording and analysis of client energy behaviour, energy saving consultation, etc. whilst other companies can even offer more energy-related products and complete solutions, such as Electric Car Chargers, PV systems, or even ESCo-type Energy Service solutions and Energy Auditing services.

Switching to an Independent Supplier is a very simple and easy process, which has multiple benefits to offer to consumers!